MNI BRIEF: Canadian Firms' Price Plans Hold At 3-Yr Low- CFIB
Canadian firms plan the smallest price increases in three years though at a 2.8% pace that remains well above the central bank's target, according to the February survey by the country's leading small business industry group.
The Canadian Federation of Independent Business also found firms expect wage increases of 2.5% over the next year. The pace has slowed from a recent peak of 3.3% last April, similar to price expectations that were 3.5% in that month. Wages and firms' price-setting behavior remain a key BOC concern as the debate shifts from whether to hike interest rates again to how long to keep restrictive monetary policy. (see MNI: BOC Still Needs Patience As Inflation Slows- Ex Staffer)
The CFIB survey also found business sentiment climbed for a third month in Feb, adding to signs the economy may yet achieve a soft landing rather than the recession. Small businesses with fewer than 100 workers account for 68% of Canada’s private-sector employment, and medium-sized companies with up to 500 employees make up another 21%. Those firms contribute about half of Canada’s GDP.